For many accounting firm owners and leaders, the idea of transforming their practices from a traditional, transaction-based model into an advisory-centric firm is an appealing one. Advisory services can lead to stronger client relationships, a healthier bottom line, and a more balanced work-life dynamic.
Yet, despite the advantages, making this shift can seem daunting. Some firms feel too overwhelmed to prioritize this transition, while others aren’t sure where to start. But advisory services are more than just a trend—they’re essential for growth and sustainability in today’s competitive market.
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Common challenges of transitioning to advisory services
While the benefits of advisory services are clear, many firms face challenges implementing them effectively. Here are a few common hurdles and how to address them.
1. Overcoming a transactional mindset.
If your firm has operated for years with a focus on compliance work, you may struggle to move beyond this transactional approach. Staff members may not yet see themselves as “advisors,” and clients may not expect or understand the value of advisory services.
However, by implementing a proven advisory roadmap and educating your team and clients on the benefits of advisory services, you can shift your firm’s role from processing numbers to providing strategic insights.
2. Feeling too busy to transition.
Many firms feel swamped by compliance work, especially during tax season, making it difficult to carve out time for strategic business model changes.
Consider starting small by allocating specific times for advisory projects, perhaps dedicating a day per month to focus solely on advisory services and gradually expanding as the process becomes more manageable. Using a structured advisory framework can also streamline the transition, helping your firm implement step-by-step changes without overwhelming your team.
3. Lack of structured pricing and service packages.
Advisory services require a different pricing model than traditional compliance work, and firms often struggle with getting a new service package up and running.
By leveraging predefined advisory service packages, you can seamlessly standardize offerings and communicate value to clients by leveraging predefined advisory service packages. Clearly outline what each package includes and price them in a way that reflects the expertise and insights your team provides. This approach helps clients understand and appreciate the investment they’re making in your knowledge and experience.
4. Managing team alignment and buy-in.
Without team buy-in, any transition is challenging. Staff members may be hesitant to take on new responsibilities or feel unsure about their role in advisory services.
To address this, involve staff in the transition process from the start. Solicit their input on how to structure services and offer professional development opportunities to equip them with advisory skills. When the team feels ownership of the process, they are more likely to embrace it wholeheartedly.
The difference implementing advisory services can make
Once your firm overcomes the initial challenges, the benefits of advisory services become transformative.
Unlike traditional compliance work, advisory services allow firms to be compensated fairly for the strategic guidance they provide. Advisory fees are typically higher than compliance fees, and clients who see the value in advisory services are often willing to invest in these relationships. By focusing on clients who value your insights, your firm can achieve sustainable revenue growth and a stronger financial foundation.
From a work-life balance perspective, advisory services are less deadline-driven than compliance work, allowing your team to work at a more sustainable pace. With advisory work, staff can engage in deeper, more meaningful client relationships without the intense time pressures of tax season. This shift not only benefits employees’ well-being but also contributes to a healthier workplace culture, making it easier to attract and retain top talent.
In addition, advisory work often means working more closely with clients over time, leading to stronger, more strategic partnerships. This deepens the client relationship, resulting in longer-term engagements and, ultimately, a more loyal client base. Moreover, when firms focus on providing advisory services, they can be more selective about who they work with, leading to a client base that aligns better with their values and goals.
Case study: Advisory in action
Lomness CPA, a Texas-based firm led by Katie Lomness, transformed from a compliance-focused practice to a profitable advisory-centered firm by adopting the Thomson Reuters Practice Forward methodology.
Initially constrained by low-dollar compliance work and resource limitations, the firm embraced advisory services in 2022 after attending a pivotal Partner Summit. Through structured client vetting, targeted service packages, and team alignment, Lomness CPA saw revenue grow by 55%, with advisory services yielding a 473% increase in revenue.
Operationally, the firm achieved improved clarity, efficiency, and employee satisfaction, fostering a culture of collaboration, work-life balance, and enhanced client experiences, solidifying its status as an innovative industry leader.
Why now is the time to transition to advisory services
The accounting landscape is changing rapidly, and firms that remain solely focused on compliance work risk being left behind. Automation and artificial intelligence are increasingly handling routine compliance tasks, which could eventually reduce the demand for traditional accounting services. Meanwhile, clients are looking for accountants who can provide real-time, data-driven insights to help them make informed decisions. The demand for advisory services is high—and it’s only growing.
While implementing an advisory model may require upfront effort, it’s a decision that will yield dividends across every aspect of your firm. The time is now to prioritize this transition, build the future you envision, and create a legacy that will support both your clients and your staff for years to come.
To learn more, contact a Practice Forward representative today.
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